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ELRCDismissedNot stated in excerpt· [2024] KEELRC 2588 (KLR)

Kaguora v Gilly Security and Investigation Limited (Appeal E226 of 2022) [2024] KEELRC 2588 (KLR)

Employment and Labour Relations Court
25 October 2024
1,857 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~7 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court confirmed that employees who resign voluntarily cannot claim terminal dues like service pay, and must file accrued leave and overtime claims within 12 months.

What this practically means

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Executive summary

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This was a first appeal to the Employment and Labour Relations Court at Nairobi against the judgment of the trial court (Hon. S.A Opande) delivered on 5th December 2022, which dismissed the Appellant's claim for terminal dues. The Appellant, employed as a site manager from 26/10/2009, resigned on 30/11/2018 for health reasons with employment ending on 1/1/2019, and sued on 24/1/2020 claiming notice pay, service pay, accrued leave, overtime, unremitted NSSF contributions and 12 months' compensation. The Respondent did not participate in the appeal or the lower court proceedings. The Court identified the sole issue as payment of terminal benefits upon resignation. It held that since the Appellant voluntarily resigned, sections 41, 43 and 45 of the Employment Act on termination were inapplicable. Notice pay failed because proper one-month notice was given; service pay was barred because the Appellant was an NSSF member under section 35(6)(d); and the NSSF claim failed on evidential grounds, the remedy lying under section 14 of the NSSF Act. On accrued leave and overtime, applying section 90 of the Employment Act and the G4S decision, the Court held these were continuing injuries accruing monthly, requiring filing within 12 months of cessation; the claim filed on 24/1/2020 was time-barred, and section 90 admits no extension. The 12 months' compensation claim was unpleaded and untenable after a voluntary resignation. The appeal was dismissed with costs.

Key legal issues

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01

Whether the Appellant's claims for accrued leave and overtime were caught by limitation under Section 90 of the Employment Act

Holding

The claims were a continuing injury and time-barred as they accrued at the end of each month, requiring filing within 12 months of cessation; the claim filed on 24/1/2020 was out of time.

Reasoning

Section 90 of the Employment Act provides a 3-year limitation period for actions arising out of employment contracts, but only 12 months in cases of continuing injury. Following G4S Security Services, monthly-accruing benefits such as leave and overtime constitute continuing injuries. The Appellant's employment ceased on 1/1/2019 and the suit filed on 24/1/2020 exceeded the 12-month window. Section 90 is mandatory with no provision for extension of time.

p. 4
02

Whether the Appellant was entitled to notice pay and service pay upon resignation

Holding

Notice pay failed because proper one-month notice was given; service pay was unavailable because the Appellant was an NSSF member, exempted under Section 35(6)(d) of the Employment Act.

Reasoning

The Appellant tendered a one-month resignation notice by letter dated 30/11/2018, so no notice pay was payable. Under Section 35(6)(d), employees registered with NSSF are exempt from service pay. The Court agreed with the trial court on both heads. As the resignation was voluntary, sections 41, 43 and 45 on termination did not apply.

p. 3
03

Whether the Appellant was entitled to 12 months' compensation

Holding

Not entitled; the claim was not justified under any head and the Appellant resigned voluntarily without alleging coercion.

Reasoning

Compensation under the Employment Act attaches to unlawful termination. The Appellant resigned voluntarily for health reasons, so sections 41, 43 and 45 had no application. Moreover, the ground of unlawful termination was not pleaded. The Court found no basis for the award.

p. 4

Legal principles established

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  • A contractual benefit which accrues at the end of each month amounts to a continuing injury for purposes of limitation under Section 90 of the Employment Act.
  • Claims for accrued leave and overtime that accrue monthly must be brought within 12 months of cessation under Section 90 of the Employment Act.
  • Where an employee is registered with NSSF, they are exempt from service pay under Section 35(6)(d) of the Employment Act.

Court orders

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  1. 1.The appeal is dismissed with costs
On appeal from
Trial Court (Magistrate's Court, employment dispute)
Not stated
Jurisdiction invoked
First appeal from the trial court's judgment of 5th December 2022

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Kaguora v Gilly Security and Investigation Limited (Appeal E226 of 2022) [2024] KEELRC 2588 (KLR)", Case Analysis (2024). Not stated in excerpt. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2588/eng@2024-10-25

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.